Two Teamsters union officials were convicted Friday of federal charges they participated in a $700,000 payroll padding scheme that involved hiring "ghost employees" who were paid but did little or no work.
A U.S. District Court jury found Harold Friedman, 66, a Teamsters international vice president and president of the Ohio Council of Teamsters, guilty of two counts of labor racketeering, one count of embezzlement and one count of filing false reports. He was acquitted of one count of embezzlement and one count of filing false reports.Teamsters Local 507 Recording Secretary Anthony Hughes, 52, was found guilty of all charges against him. He was charged with two counts of labor racketeering and one of embezzlement, which could carry penalties of up to 45 years in prison and a fine up of to $60,000.
Hughes was accused of being a "ghost employee," an employee paid for doing no work.
Friedman could have been sentenced to as long as 52 years in prison and fined up to $90,000 if he had been convicted on all charges. No sentencing date has been set.
When the verdict was announced, Hughes looked down and shook his head, but Friedman showed no emotion. A couple of women in a crowd of supporters cried, and another ran out of the courtroom sobbing.
Jackie Presser, Teamsters international president until his death of brain cancer July 9, was indicted with Friedman and Hughes on May 16, 1986, but was never tried. His illness prompted repeated delays in the trial, which started Oct. 24 and heard from 80 witnesses.
Court documents have indicated that Presser, also secretary-treasurer of Local 507, and Hughes were FBI informants. Presser's former attorney, John R. Climaco, has said Presser's defense would have been that he was authorized by the FBI to hire "ghost employees" to enhance and protect his informant status.
The prosecution contended that Presser couldn't have been authorized to hire "ghost employees" because they were on the payroll as early as 1972, and Presser didn't begin informing until 1977. Friedman's attorney said Presser was a government informant in 1963.
Lawyers for Friedman and Hughes asked U.S. District Judge George W. White to release documents about Presser's work as an informant, but the judge declined, preserving the mystery over who Presser informed on and when.
When White declined to release the documents, Friedman and Hughes rested their case without using the defense planned by Presser. Friedman testified that as far as he knew, the alleged "ghost employees" worked for their pay.